Basic questions on Black-Scholes
- Thread starter blueraincap
- Start date
It's right by definition. The one factor that can not be calculated in the model once the price is fixed, is the real volatility which depends on human thought process and emotion. One can, however, compute what the volatility should be to justify the actual price according to the model (i.e., the implied volatility). The real, volatility might at times be quite far from this computed volatility.
Your insights are highly valued by many members of ET.
doubt it, that would assign a higher iq to the masses than is justified
speaking of insights.
if you actually watch options trade, and dont just look at the eod yahoo matrix (99% of ya) , you can see how they are priced.
if you actually watch options trade, and dont just look at the eod yahoo matrix (99% of ya) , you can see how they are priced.